GNPC’s Not Part of Government of Ghana, State Oil Firm Tells Auditor General - Africa’s premier report on the oil, gas and energy landscape.

GNPC’s Not Part of Government of Ghana, State Oil Firm Tells Auditor General

By Toyin Akinosho

Ghana National Petroleum Corporation (GNPC) says that the country’s Auditor General was wrong to have accused it of breaching Public Procurement Law pertaining to Parliamentary approvals for international business transactions.

The corporation says that the cited law strictly relates to “Government” business and not generally to statutory corporations set up for commercial purposes.

“The Ghana National Petroleum Corporation Act (PNDCL 64) establishes GNPC as a distinct legal entity and, as such, it is not legally considered to be part of Government”, GNPC declares.

GNPC was responding to the call on government, by the Auditor-General’s office, to sanction the corporation for procuring the following five contracts, for a total sum of $34,165,235.15 and GBP464,963.13 (about $34.165Million and £465,000), without Parliamentary Approval.

The contracts, as well as the manner with which they were procured, are listed as follows:

1 Procurement of Teammate full version automated audit management system 28/08/2015 Wolters Kluwer Tax and Accounting Ltd $60,100.00. Single Source.

2 Procurement of Resolve Software 04/10/2016 Messrs. Petroleum Expert (UK) Limited £47,883.13 Single Source.

3 Procurement of Seismic Survey Design Software and related activities 23/06/2017 Messrs GX Technology, GMG Products Division $116,039.15. Single Source.

4 Procurement of a contractor to acquire and process 2D Seismic Data over the Voltarian Basin for GNPC 15/04/2015 Messrs. BGP-Bay Geophysical Limited $33,989,096.00. Restrictive Tendering.

5 Development of Brand Architecture for GNPC and Explorco 27/11/2015 Future Brand £417,080.00. Single Source.

“This practice has the tendency of not allowing the intentions of the promulgators of the law (1992 Constitution) inure to the benefit of the State”, the Auditor-General had admonished. “It also denies the Lawmakers the opportunity to make inputs towards such transactions.

“The absence of above could plunge GNPC into paying for higher contract sums and possible judgment debts. Report of the Auditor-General on the Public Accounts of Ghana – Public Boards, Corporations and Other Statutory Institutions for the year ended 31 December 2020 142”, the Auditor-General observed. “We recommended that Management of GNPC should be sanctioned in accordance with Section 92 of the Public Procurement Act 2003, (Act 663) as amended for breaching the Public Procurement Law”.

The Auditor-General’s Office however noted that GNPC Management explained that “the products involved in the transactions in question were all proprietary products that needed to be procured from the Original Equipment Manufacturer (OEM)”.  

The GNPC Management also stated, according to the Auditor-General, that it sought and obtained the approval of the Public Procurement Authority (PPA) for those transactions and that the items involved were captured in the approved annual budget of the corporation which was approved by Parliament, as well as its approved procurement plans for the respective periods”. But the Auditor-General’s report insisted that the “ said budgets were not made available for our review, more so, from our audit point of view, Parliamentary approval of the Corporation’s budget does not imply approval for international business contracts since the budget does not indicate the procurement method to use neither does it indicate the vendors to deal with”.

It, therefore “reiterated its audit recommendation”, that GNPC be sanctioned.

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